BAJAJ AUTO FINANCIAL ANALYSIS

BYANILKUMAR T

NAMANANKITA

• Bajaj Auto is a major Indian automobile manufacturer.

• It is India's largest and the world's 4th largest two- and three-wheeler maker.

• Chairman RahulBajaj

BALANCE SHEET OF BAJAJ AUTO

Sources Of Funds Mar '06 Mar '07 Mar '08 Mar '09 Mar '10

Total Share Capital 101.18 101.18 144.68 144.68 144.68

Equity Share Capital 101.18 101.18 144.68 144.68 144.68

Share Application Money 0.00 0.00 0.00 0.00 0.00

Preference Share Capital 0.00 0.00 0.00 0.00 0.00

Reserves 4,669.55 5,433.14 1,442.91 1,725.01 2,783.66

Revaluation Reserves 0.00 0.00 0.00 0.00 0.00

Networth 4,770.73 5,534.32 1,587.59 1,869.69 2,928.34

Secured Loans 0.02 22.46 6.95 0.00 12.98

Unsecured Loans 1,467.13 1,602.97 1,327.39 1,570.00 1,325.60

Total Debt 1,467.15 1,625.43 1,334.34 1,570.00 1,338.58

Total Liabilities 6,237.88 7,159.75 2,921.93 3,439.69 4,266.92

Application Of Funds Mar '06 Mar '07 Mar '08 Mar '09 Mar '10

Gross Block 2,894.22 3,178.54 2,994.68 3,350.20 3,379.25

Less: Accum. Depreciation 1,761.22 1,904.94 1,726.07 1,807.91 1,899.66

Net Block 1,133.00 1,273.60 1,268.61 1,542.29 1,479.59

Capital Work in Progress 43.33 107.62 34.74 106.48 120.84

Investments 5,856.97 6,447.53 1,857.14 1,808.52 4,021.52

Inventories 272.93 309.70 349.61 338.84 446.21

Sundry Debtors 301.55 529.83 275.31 358.65 272.84

Cash and Bank Balance 80.84 62.16 54.74 135.68 100.20

Total Current Assets 655.32 901.69 679.66 833.17 819.25

Loans and Advances 2,282.98 2,925.24 1,099.68 1,567.09 2,291.29

Fixed Deposits 1.25 21.32 1.33 1.19 1.21

Total CA, Loans & Advances 2,939.55 3,848.25 1,780.67 2,401.45 3,111.75

Deffered Credit 0.00 0.00 0.00 0.00 0.00

Current Liabilities 1,419.08 1,683.46 1,185.19 1,378.20 2,218.06

Provisions 2,315.89 2,833.79 834.04 1,224.15 2,248.72

Total CL & Provisions 3,734.97 4,517.25 2,019.23 2,602.35 4,466.78

Net Current Assets -795.42 -669.00 -238.56 -200.90 -1,355.03

Miscellaneous Expenses 0.00 0.00 0.00 183.30 0.00

Total Assets 6,237.88 7,159.75 2,921.93 3,439.69 4,266.92

Contingent Liabilities 719.06 811.66 1,129.29 924.96 818.25

Book Value (Rs) 471.49 546.96 109.73 129.23 202.40

PROFIT AND LOSS ACCOUNT

Income

Sales Turnover 8,653.83 10,741.91 9,856.66 9,310.24 12,420.95

Excise Duty 1,081.70 1,321.67 1,029.51 610.07 607.70

Net Sales 7,572.13 9,420.24 8,827.15 8,700.17 11,813.25

Other Income 458.96 567.16 170.27 -4.52 38.76

Stock Adjustments 49.01 -0.90 67.85 -24.49 47.60

Total Income 8,080.10 9,986.50 9,065.27 8,671.16 11,899.61

Expenditure

Raw Materials 5,446.62 6,969.50 6,760.04 6,502.10 8,187.11

Power & Fuel Cost 59.09 79.34 69.20 60.89 70.35

Employee Cost 282.45 310.07 350.09 366.67 411.76

Other Manufacturing Expenses 79.50 74.53 53.72 58.10 73.80

Selling and Admin Expenses 299.99 457.17 390.15 383.41 423.87

Miscellaneous Expenses 198.52 230.89 209.63 226.22 221.94

Preoperative Exp Capitalised -24.81 -32.05 -23.04 -14.42 -15.67

Total Expenses 6,341.36 8,089.45 7,809.79 7,582.97 9,373.16

Operating Profit 1,279.78 1,329.89 1,085.21 1,092.71 2,487.69

PBDIT 1,738.74 1,897.05 1,255.48 1,088.19 2,526.45

Interest 0.34 5.34 5.16 21.01 5.98

PBDT 1,738.40 1,891.71 1,250.32 1,067.18 2,520.47

Depreciation 191.00 190.26 173.96 129.79 136.45

Other Written Off 3.62 0.39 1.12 0.00 0.00

Profit Before Tax 1,543.78 1,701.06 1,075.24 937.39 2,384.02

Extra-ordinary items 59.03 26.60 59.32 18.72 24.25

PBT (Post Extra-ord Items) 1,602.81 1,727.66 1,134.56 956.11 2,408.27

Tax 479.11 490.09 378.78 301.61 707.50

Reported Net Profit 1,101.63 1,237.96 755.95 656.48 1,702.73

Total Value Addition 894.74 1,119.95 1,049.75 1,080.87 1,186.05

Preference Dividend 0.00 0.00 0.00 0.00 0.00

Equity Dividend 404.74 404.73 289.37 318.30 578.73

Corporate Dividend Tax 56.76 68.78 49.18 54.10 96.12

Per share data (annualised)

Shares in issue (lakhs) 1,011.84 1,011.84 1,446.84 1,446.84 1,446.84

Earning Per Share (Rs) 108.87 122.35 52.25 45.37 117.69

Equity Dividend (%) 400.00 400.00 200.00 220.00 400.00

Book Value (Rs) 471.49 546.96 109.73 129.23 202.40

RATIO ANALYSIS

LEVERAGE RATIOS

• Debt-equity Ratio

Debt 1338.58 = = 0.435

Equity (144+2928)

• Debt-asset Ratio

Debt 1338.58 = = 0.313

Assets 4266.92

• Interest Coverage Ratio

Profit before interest and tax 2384.02 = = 3.23

Interest 707.5

TURNOVER RATIOS

• Inventory TurnoverCost of goods sold 12420.95Average inventory (446.21 + 338)/2

• Debtors’ TurnoverNet credit sales Average debtors

• Fixed Assets Turnover Net sales Average net fixed assets

• Total Assets Turnover Net sales

Average total assets

= =29.19

=37.41

=3.50

=2.77

LIQUIDITY RATIOS

• Current Ratio

Current assets 1355.03Current liabilities 2218.06

• Acid-Test Ratio

Quick assets (1355.03-135)Current liabilities 2218.06

• Cash Ratio

Cash and bank Current balances investments (100.2 +4021.52)

Current liabilities 2218.06

= = 0.61

= = 0.55

+= = 1.858

PROFITABILITY RATIOS

• Gross Profit Margin Ratio

Gross profit 2384

Net sales 11813.25

• Net Profit Margin Ratio

Net profit 1702.73

Net sales 11813.25

• Return on Assets (ROA)

Profit after tax 1702.73

Average total assets (3439.69 + 4266.92)/2

= = 20.1%

= = 14.41%

= =44.1%

PROFITABILITY RATIOS

• Earning Power

Profit before interest and tax 2384.02

Average total assets (3439.69 + 4266.92)/2

• Return on Capital Employed

Profit before interest and tax (1 – Tax rate) 2384.02(1 – 0.054)

Average total assets ((3439.69 + 4266.92)/2

• Return on Equity

Equity earnings 578.73

Average equity

=61.8%

= 58.5%

= 0.131 or 13.1 percent

=

=

=

VALUATION RATIOS· Price-earnings Ratio

Market price per share 2850.75 = = 24.22

Earnings per share 117.69

· Yield Dividend Price change

+ Initial price Initial price

Dividend yield Capital gains/losses yield 584 1.0 = 9.35% = 5% 20.0 20.0

· Market Value to Book Value RatioMarket value per share 2850.75 = = 14.1Book value per share 202.4

THANK YOU